Imagine your goods trapped in congested ports like prisoners in invisible cages, watching delivery dates flutter uncertainly like leaves in the wind, postponed again and again. Customer patience evaporates like a slowly drying river. This isn't alarmism or fantasy—it's the harsh reality global supply chains face amid surging e-commerce demand.
SEKO Logistics experts warn we may be entering a "never-ending peak season"—not just a temporary phenomenon but a long-term trend fundamentally reshaping global trade patterns.
E-commerce Surge: The Engine Driving Supply Chain Transformation
Earlier this year, SEKO Logistics Chief Growth Officer Brian Bourke identified the true driver behind supply chain disruptions during a media briefing. He explained how persistent pandemic impacts combined with explosive e-commerce growth have strained fragile supply chains to breaking point.
Consumer behavior has undergone seismic shifts. Where experiential spending on travel, dining and entertainment once dominated, pandemic restrictions redirected spending toward physical goods—home furnishings, electronics, apparel and more. This transformation has sent e-commerce orders surging like volcanic eruptions.
"We predicted this would become a perpetual peak season, but reality has proven even more severe," Bourke emphasized, noting how events like the Suez Canal blockage and congestion at China's Yantian port have compounded challenges.
From raw material suppliers to manufacturers to end consumers, every link faces unprecedented uncertainty—soaring material costs, unstable production schedules, elevated shipping expenses and unreliable delivery timelines. Compounding these issues, inventory-to-sales ratios continue declining, meaning businesses hold less stock while demand grows stronger.
SEKO's advice to clients is unequivocal: order early and secure capacity. "Waiting for conditions to improve isn't realistic—challenges will persist across most transport modes and regions until at least Lunar New Year 2022, if not longer," Bourke added.
Port Congestion: The New Normal
SEKO General Manager Brian Baskin analyzed port-side challenges, noting how 30 vessels recently queued outside Los Angeles harbor like concertgoers awaiting entry. With traditional peak season approaching, uncertainty remains whether conditions will improve.
"If ports can restore sufficient labor to accelerate vessel turnover, we might see improvement," Baskin said cautiously, noting containers currently take 4-7 days to move from ports depending on terminals.
A critical risk looms when Asia's backlogged shipments arrive en masse. "We're seeing unprecedented container volumes heading to single destinations," Baskin explained, as carriers consolidate port calls to maintain schedules, overwhelming infrastructure.
SEKO client reports show purchase orders already delayed, with summer shipments pushed to August. Baskin anticipates summer volumes will arrive normally, but predicts a potential "collision" of shipments in August-September that could trigger severe Los Angeles port congestion.
Driver Shortages: Compounding the Crisis
The longstanding driver shortage has worsened during the pandemic. "Finding trucks and trailers remains extremely difficult," Baskin noted, as port congestion reduces drivers' productivity by increasing wait times.
Long-haul rates from Los Angeles have reached $5 per mile, with short-haul markets imposing congestion surcharges. Baskin estimates 18 months may be needed for meaningful improvement as cyclical fluctuations persist.
Strategies for the Never-Ending Peak Season
Businesses must adopt proactive approaches to navigate these challenges:
1. Advance Planning
Engage suppliers early, forecast demand accurately and secure capacity well in advance to avoid shipping delays.
2. Inventory Optimization
Implement advanced inventory management with demand forecasting and real-time tracking to balance stock levels.
3. Supply Chain Diversification
Avoid over-reliance on single suppliers or routes by building diversified supply networks.
4. Logistics Partnerships
Develop long-term relationships with reliable logistics providers to collaboratively address challenges.
5. Digital Transformation
Leverage IoT, big data and AI to enhance supply chain visibility and decision-making.
6. Sustainability Focus
Adopt eco-friendly transport and packaging to reduce environmental impact while improving brand image.
The never-ending peak season is redefining global supply chains. Businesses that embrace innovation through these strategies will be best positioned to thrive in this new reality.